Health care penalty?

[ripvanwinkle]

First off, I'm a veteran and have VA insurance. However, my sisters and I are at differences in reading this 1% or $95 penalty.

My question is this: Is the penalty a ONE TIME each year fee or is the penalty a monthly fee? Healthcare.gov says this.

•1% of your yearly household income. The maximum penalty is the national average yearly premium for a bronze plan.

OR

•$95 per person for the year ($47.50 per child under 18). The maximum penalty per family using this method is $285.

•The fee increases every year. In 2015 it’s 2% of income or $325 per person. In 2016 and later years it’s 2.5% of income or $695 per person. After that it is adjusted for inflation.

If it's a one time yearly fee, they would be saving over $500 month by not joining. That's a no brainer.

[resolution]

It is a yearly fee. To me it's a no brainer to buy the insurance to have medical coverage.

[Sum Dum Gai]

The penalty is cheaper than the insurance, assuming you don't get sick.  If you do get sick the bills are going to make the insurance premium look like a bargain.  Look at it this way, prior to the ACA it was free to go without medical insurance.  Almost nobody did it unless they were in really dire straights, or here illegally, because one hospital visit could wipe you out financially.  That's still true, only now there's a penalty on top of it.

[Deleted]

To me it's a no brainer to buy the insurance to have medical coverage.

Which is why the mandate/tax is such a silly idea (although the original idea of catastrophic coverage or bond to plug the 'free rider' hole in EMTALA specifically might have had merit). Anybody who sees value in insurance will buy it. Anybody who balks at the upfront cost of insurance will continue so to balk unless strictly greater cost attaches to not buying it.

(This is the obliquely stated approach adopted by this administration to alternative fuels, at the risk of getting political.)

[resolution]

You aren't allowed to get political on EE or they will just change the subject to deviant things you can do with chocolate, or something along those lines.

A major problem with the $10,000 bond idea is that it won't go very far if someone has a catastrophic event. It is too easy to rack up $100,000 or more in a hospital. 

[Deleted]

deviant things you can do with chocolate

- is, to be totally fair, a much more interesting and useful topic.

It is too easy to rack up $100,000 or more in a hospital

And there lies the rub. Why is a colonoscopy ten times more expensive in the US than the same procedure with the same equipment elsewhere in the world? Why is it the preferred diagnostic course here in the US when the literature shows other, less expensive, diagnostic methods are equally effective? Why does a Band-aid cost $30 on an itemized hospital bill? I agree, addressing the 'free rider' problem doesn't matter unless you first get to the root of why everything healthcare related costs vastly more here than elsewhere in the world, and do some work on the drivers of that. Good luck getting doctors to accept a 60% pay cut, but that and things like it are where we need to start.

[NoNamePerson]

Calling Death by Chocolate - they are talking about you    See that didn't take long did it

[Deleted]

All that talk of chocolate made me hungry. Your brain is delicious, NoName.

[NoNamePerson]

That's the nicest thing anyone has said to me lately. Not the delicious part but that I had a brain

[resolution]

Oct 29, 2013 8:38:20 GMT -5 @thatmojoguy said:

deviant things you can do with chocolate

- is, to be totally fair, a much more interesting and useful topic.

It is too easy to rack up $100,000 or more in a hospital

And there lies the rub. Why is a colonoscopy ten times more expensive in the US than the same procedure with the same equipment elsewhere in the world? Why is it the preferred diagnostic course here in the US when the literature shows other, less expensive, diagnostic methods are equally effective? Why does a Band-aid cost $30 on an itemized hospital bill? I agree, addressing the 'free rider' problem doesn't matter unless you first get to the root of why everything healthcare related costs vastly more here than elsewhere in the world, and do some work on the drivers of that. Good luck getting doctors to accept a 60% pay cut, but that and things like it are where we need to start.

I agree. It's not just the doctors but the whole insurance and pharmaceutical industries that have so much vested in the current system. I don't see a good way to solve our problems without a devastating impact to some of the major players.

[Deleted]

I don't see a good way to solve our problems without a devastating impact to some of the major players.

Right. A lot of the sticker shock being experienced by some right now on their health insurance costs could have been alleviated by forcibly lowering insurance company overhead in the sense of holding down prices for provision of healthcare services. That would have been its own massive can of worms, of course - I'm not sure that it could be done constitutionally in this country - but it's how healthcare costs are held down elsewhere in the world: the funds that pay the providers dictate the terms. In this country, the providers dictate the terms and the piecemeal single-payer insurance programs distort the market for everybody else.

[mmhmm]

I'm going to move this thread to Current Events.  It really doesn't belong in EE as this is the place for "lighter" conversation and those who post here regularly kinda like to keep it that way, for the most part.  

mmhmm, Administrator

[resolution]

It is one of the few areas where competition doesn't work very well to hold down prices because of the in-elasticity of demand. If I am in an accident somewhere and get taken to the nearest hospital, I am not going to be calling different hospitals from the ambulance trying to find the best deal. Or if I need a specialized surgery, I am going to find the person that has the best results and not try the one with the 50% sale and poor success rate.

[Deleted]

Right, healthcare in the emergency setting is not a private good. Preventive healthcare can be a private good, and as it happens, a robust market in preventive healthcare controls demand indirectly in the emergency healthcare market - that's one reason why mandating preventive healthcare as part of an overall insurance package is the wrong way of addressing the right problem, in that it correctly emphasizes prevention but does so by misidentifying prevention - a private good for which market mechanisms can effectively control prices - with the catastrophic care that is the proper business of health insurance. In practice, as with everything you add to a bare-bones catastrophic plan, preventive healthcare becomes a sink for the excess costs of your $1-million emergency-->inpatient case. What should be a cost control becomes an excuse to avoid cost control.

[zibazinski]

Where can I get my colon examined for cancer without a colonoscopy?

[Deleted]

Zib, I just bit you.

[Deleted]

Oct 29, 2013 9:18:46 GMT -5 resolution said:

It is one of the few areas where competition doesn't work very well to hold down prices because of the in-elasticity of demand. If I am in an accident somewhere and get taken to the nearest hospital, I am not going to be calling different hospitals from the ambulance trying to find the best deal. Or if I need a specialized surgery, I am going to find the person that has the best results and not try the one with the 50% sale and poor success rate.

Oh you Americans, why do you have to make health care so complicated?

[Deleted]

Oct 29, 2013 15:05:08 GMT -5 @joey said:

Zib, I just bit you.

That is one way to check Zib's colon.

[Deleted]

Oct 29, 2013 15:07:03 GMT -5 ArchietheDragon said:

Oct 29, 2013 15:05:08 GMT -5 @joey said:

Zib, I just bit you.

That is one way to check Zib's colon.

hmmm.. I hope i don't get arrested.

[Deleted]

Oct 29, 2013 9:04:20 GMT -5 NoNamePerson said:

That's the nicest thing anyone has said to me lately. Not the delicious part but that I had a brain

You are being very modest at the least, NoNameWitch.

[Deleted]

Oct 29, 2013 9:11:52 GMT -5 @thatmojoguy said:

I don't see a good way to solve our problems without a devastating impact to some of the major players.

Right. A lot of the sticker shock being experienced by some right now on their health insurance costs could have been alleviated by forcibly lowering insurance company overhead in the sense of holding down prices for provision of healthcare services. That would have been its own massive can of worms, of course - I'm not sure that it could be done constitutionally in this country - but it's how healthcare costs are held down elsewhere in the world: the funds that pay the providers dictate the terms. In this country, the providers dictate the terms and the piecemeal single-payer insurance programs distort the market for everybody else.

I don't know all the ins and outs of your medical system but I am curious as to why the private insurance companies do not lower their rates in an effort to maintain some of the many clients they say they are losing?

[Deleted]

Never mind the above question Mojo. 
It looks to me like this is the perfect time for greedy insurance companies to their expensive customers with "pre existing" conditions and Obama takes the blame.
Win win for the private insurers though.

[resolution]

Private insurance companies aren't losing any customers, in fact every American is now required by law to buy their product. The exchange web site everyone is posting about carries plans from the private insurers.

The issue of people losing insurance they currently have is because the law requires insurers to cover more expenses, so plans that don't cover enough are being cancelled and people are being required to buy more comprehensive plans. The new plans cost more than the catastrophic plans because they cover more, which is a negative for people that liked having just the catastrophic coverage. 

[zibazinski]

That's so mean! Plus, it still doesn't answer my question. Where can I get a test for colon cancer without a colonoscopy?

[Deleted]

Oct 29, 2013 15:04:30 GMT -5 zibazinski said:

Where can I get my colon examined for cancer without a colonoscopy?

For starters, a screening colonoscopy doesn't necessarily find cancers:

jnci.oxfordjournals.org/content/101/6/366.full

It is the "most invasive" screening method, with the highest risk of mortality and morbidity. It is more likely to be performed by a specialist gastroenterologist in the US, and a specialist here is likely to be reimbursed at two or three times the rate of his counterpart elsewhere in the world, and that's part of why it's more expensive. But it's also the case that screening colonoscopies are done more often in this country than elsewhere in the world.

Sigmoidoscopy is a less invasive option. Fecal Occult Blood testing is less invasive still. There is a tradeoff in terms of percentage chance of detecting cancer early, according to the received wisdom, but:

www.ncbi.nlm.nih.gov/pubmed/15188160

- this French study shows a 67% mortality reduction ratio for repeated FOBT testing, which is the same as the first study showed for colonoscopy. You had better believe it's cheaper and more convenient all around to do an FOBT test every couple of years rather than undergo even a sigmoidoscopy.

That's one example. The protocols that we use in this country are shaped a lot more by pressure from professional specialist medical associations than we'd like to believe. It really is a case of six wolves and a sheep coming together to decide what's for dinner.

[Deleted]

I don't know all the ins and outs of your medical system but I am curious as to why the private insurance companies do not lower their rates in an effort to maintain some of the many clients they say they are losing?

I don't, either, I'm from England originally.

The situation here was that most people in work got healthcare through private insurers (like BUPA), with Medicare for elderly and disabled people, and Medicaid for some poor people who meet certain conditions (they're kids, or pregnant, or REALLY poor, for example). The reform has made the insurers include more things in their coverage, which makes their plans more expensive; and people are forced to buy the more expensive plans or pay a mandated 'tax.' As it happens this tax is much cheaper than the hiked premiums, so the effect of the law - which was supposed to get more people coverage - is to people who had insurance off insurance. At the same time, insurers by law now HAVE to keep the most expensive people - the really sick ones with pre-existing conditions - on their books, and these folks are mad keen to get on insurance they couldn't get before.

What we have is a transition from an insured population that was about 90% risk-pooled - that is, most of the risk of the least healthy insured was borne by the healthiest - to one skewed more toward the unhealthy end, which raises everybody's premiums. When this was done at the state level in Massachusetts, back in 1996, it raised average premiums 40%. In some markets, the Obamacare reform is making the cheapest available policy 170% more expensive than before.

And healthcare still costs more than twice per capita here than anywhere else; and we're STILL going to have about 15% of our population uninsured. It's batshit crazy, frankly.

[Deleted]

If the subsidy piece isn't working yet, how do people know what they are going to be paying? 

[Sum Dum Gai]

If you're over 400% of the poverty level, which you can find out right now, you won't get a subsidy, so the sticker price is your price.

[Deleted]

Of course, if you're UNDER 400% of the poverty level, it gets trickier.

And you're applying for the subsidy in advance, but it's being assessed in retrospect, so if you're below 400% of FPL and your income changes over the next 12 months, you could end up having to pay back some subsidy.

Which could end up costing you more than the fine for not accepting the subsidy.

It's a beautiful system from the viewpoint of somebody who found the whole edifice hubristic from the start. It's Godawful from any other perspective at all.

[Sum Dum Gai]

Even with a subsidy the fine will probably be cheaper than the insurance.  However, that was true prior to the ACA too.  It's always been cheaper to skip insurance than it is to buy it.  Most people didn't go without health insurance by choice though, so all the doom and gloom predictions of people doing so now seems pretty silly.

Prior to the ACA the math looked like this:
Go without insurance:
cost = $0

Get insurance:
cost = a lot

Now the math looks like this:
Go without insurance:
cost = 1% of your pay

Get insurance:
cost = a lot

For some reason even though the go without insurance option just got more expensive everyone is predicting that more people will choose it because it's less than a lot.  I don't see it.

The piece everyone is overlooking, except health insurance consumers, is that the cost of going without insurance isn't really as cheap as it seems.  One hospital trip and suddenly you're formerly $0, now 1% of annual pay, choice just cost you $50-100k.